Impact of Purchase Orientations on Loyalty Programs

This assignment examines the effects of various purchase orientations on consumer perceptions of loyalty program benefits and their level of loyalty. It delves into research papers analyzing factors like instant reward programs, bonus premiums, cultural values, and target/bystander effects in shaping customer behavior towards loyalty programs.

RESEARCH PROJECT

Table of Contents
PART 1............................................................................................................................................1
Introduction......................................................................................................................................1
Project Title......................................................................................................................................1
Aim and Objectives..........................................................................................................................1
Research Question:.................................................................................................................1
Literature Review.............................................................................................................................1
Research Methodology....................................................................................................................4
Expected Outcome...........................................................................................................................5
Gantt Chart.......................................................................................................................................6
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................8

PART 1
Introduction
Main aim of any firm is to gain maximum profit, this is only possible when they will be
able to understand the needs and requirement of customers. For this process, they make use of
strategies that will enable to make customers attract towards the products and services that are
delivered by the firm. This research is on Marriott Hotel that is a well known organization and
aim at deliver their customers with high quality services. This research will enable to determine
the impact of customers loyalty and reward schemes.
Project Title
“ To understand the impact of consumer loyalty and rewards schemes: A study on
Marriott hotel UK”.
Aim and Objectives
 To understand conceptual frame work of consumer loyalty and reward scheme.
 To identify impact of rewards scheme on performance of Marriott hotel
 To analyses the factors that impact on consumer loyalty at Marriott hotel
 To investigate whether consumer loyalty and rewards work in the Marriott hotel UK or
not.
 To recommend strategies to raise customers loyalty for the services of Marriott hotel UK.
Research Question:
 What is the conceptual frame work of consumer loyalty and reward scheme.
 What is the impact of rewards scheme on performance of Marriott hotel
 What are the factors that impact on consumer loyalty at Marriott hotel.
Literature Review
This holds of utter importance as it gives a brief idea about the overall researches that
have been conducted till now by a diversified range of people over similar related topics.
Furthermore, in order to carry forward the present researches, reference is taken from earlier
ones which have been already conducted. Moreover, it also gives an idea about the research gap
that exists. Also, the earlier researches done over similar topic amplifies the knowledge of
researcher. This knowledge is then further utilised by researcher to carry forward his present
research.
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According to Yi Jeon and Choi, (2013), for an organization to attain success, one thing is
very important and that is the loyalty of customers towards it. If the organization is able to satisfy
the customers in terms of quality and quantity then, customers will prefer that particular firm for
the products similar to previous one. As stated by Stathopoulou and Balabanis, (2016), this way,
consumers will become loyal towards that organization and customer loyalty is automatically
achieved. In order to attract customers, the company shall start offering reward schemes such as
making a complimentary product free over purchase of some particular set of products. This way
company will be able to grab the attention of majority customers and hence attain enhanced
performance. However, as per the arguments made by Minnema, Bijmolt and Non, (2017), when
reward schemes are being developed, one thing has to be kept in mind that, the overall financial
status of company shall never be negatively impacted by them. Reward schemes should be
therefore formulated in such a way that the products sale is also enhanced and at the same time
consumers also get attracted. So according to Hwang and Kandampully, (2015), keeping a bridge
between the reward schemes and financial status of company is very important for an
organization. The organizations should at all times try gaining loyalty from diversified range of
customers so as to gain a profitable sales. In order to do so, the best time to offer reward schemes
is during the festive season where people look out for different products. If they find out a
reasonable product is offering adequate reward the, automatically that particular product will
grab the consumer's attention. So overall it can be said that consumer loyalty with respect to a
particular organization can only be achieved if proper and adequate reward schemes are being
offered over that product. Alternatively, as stated by Dorotic and et.al., (2014), delivering
premium quality services and products can also emerge out to be of great help.
For gaining profits and enhancing of sales organizations at all times try to maintain a
good relationship with its associated customers. So, in order to stay connected with majority of
customers as stated by Meyer-Waarden, Benavent and Castéran, (2013), company should try
serving consumers with complimentary reward products for purchasing a particular item or
service. Consumers at certain times do not purchase a particular product because the price factor
plays a key role towards their disinterest. As a result because of price customers do not purchase
a product. But if company implies a certain sort of reward scheme over that particular product
then, consumers rethink over their decision . As stated by Thompson and Chmura, (2015),
customers usually get attracted towards the products over which they are being offered certain
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reward. As a result, reward schemes contribute in enhancement of sales of a particular
organization. However, as per the arguments given by Xiong, King and Hu, (2014), there have
been situations in which companies have faced huge losses in accordance with offering such
reward schemes. What actually happens is that, companies in order to gain competitive
advantage in market and gaining a larger customer base, introduce reward schemes on majority
products. Though it is able to grab a huge customer base but at the same time, the financial status
and economy is hugely impacted since amount invested becomes more that amounts received.
Furthermore, in order to control such losses, again the companies deduct all such reward
schemes. This way customers are taken aback and sales go down in an instance. So, the
companies should try maintaining a balance between the reward schemes and financial condition
& economy of particular company. If this link is well maintained and properly balanced then, the
impact could be converted into a positive one. This way reward schemes will help in betterment
of the particular organization.
Factors affecting customer loyalty: There are many factors that affect the loyalty of
customers towards a particular organization. One of the major factor is the core offer that
company gives to its consumers. It decides the durability of how long will the consumer be
influenced to stay in touch with that organization. So, companies need to understand the needs
and requirements of customers and try fulfilling them through their diversified products and
services. The location is also taken into account in such situations. Furthermore, the quality is
treated as a major parameter in order for determination of the standards of product. If a particular
service offered by company is more commoditised then customers are likely to get attracted
towards that product. Furthermore, the marketplace also affects the buying decisions of
consumers. In it the current technologies also play a key role. If a product is offering greater
amount of commodities to customer then, they will be automatically attracted towards that
particular item. So the loyalty of customer towards a particular company will hugely be affected
by the premium quality offered through it. If a product is successfully able to satisfy the needs
and wants of customers then, `customers will definitely become loyal towards that particular
thing. Also, enhancement of customer loyalty will further enhance the overall sales of company's
products. The loyalty of customer will hugely be affected by all the parameters that have been
mentioned above. But as per arguments stated by Wang and et.al., (2016), consumers are also
influenced by recommendations and reviews given to them from their family and friends. Also,
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this parameter has a major impact over customers buying behaviour. So if the product is able to
satisfy majority of people then a positive impact will be created over their minds. As a result,
they will further give positive reviews to others in relation with them. So overall the buying
behaviour of customers is hugely affected by such reviews. So as a result, the loyalty towards a
company is accordingly decided.
According to Wieseke, Alavi and Habel, (2014), it is very important that the maintenance
of customer loyalty and efficiency of reward system is continuously evaluated. In order to do so,
organizations shall take help of feedbacks to determine the timely effectiveness. These feedbacks
should be taken both from internal staff members as well the external parties in association with
the particular organization. A separate feedback should be taken from the customers. This
feedback should take in account each & every parameter in association with the product. It
should include parameters such as the experience, reviews, suggestions. Also, as stated by Khan,
(2014), even if organization is able to attain a large base of customers in terms of loyalty then
also if this loyalty is not able to be maintained, customers will be negatively affected. Also, the
rewards system effectiveness shall also be evaluated within this feedback system that whether
they are getting desired reward or not. So evaluation shall be done on a regular basis.
Research Methodology
Research philosophy: Research philosophy will be used in the present study because it
helps researcher in investigating the sources which help in understanding the problem deeply
(Berezan, Tanford and Kim, 2015). There are two type of research philosophy that is positivism
and interpretivism which help scholar in carry out whole study. In the present study researcher
will used interpretivism philosophy in which It focus on different part and cover different theory
and models for carrying out the study.
Research approach: This is type of blue print that enables to conduct the research in an
effective manner. There are of two type (Steinhoff and Palmatier, 2016). In this context, it
includes inductive and deductive approach. In this management will make use of inductive
approach. This help to present the information effectively and efficiently.
Research design: Research design is a techniques which support researcher in conduct
whole study in systematic manner and in logical way. There are different type of research design
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that us exploratory, descriptive and experimental. In the present study researcher will used
descriptive research design so that it can carried out research which is based on theory.
Data collection method: data collection method is very important for carrying out the
whole research and to come up with valid outcome. There are two method of collecting the data
that is primary and secondary. In present research researcher used primary and secondary data in
order to get valid outcome (McCall and McMahon, 2016). In primary data collection method
researcher will used questionnaire for collecting new and fresh information. On the other hand
secondary information will be collected with the help of books and journals and internet.
Data analysis: For analysing the collected data researcher will used different tools and
techniques in order to get effective outcome. There are two techniques for analysing the
collected data that is qualitative and quantitative techniques (Ramaseshan and Guilfoyle, 2015).
In the present study researcher used qualitative techniques in which themes are prepared and
result is interpreted with the help of table and charts.
Sampling: Sampling is very important because it support researcher in targeting the
people for collecting the information from the whole universe (So, Danaher and Gupta, 2015).
The collecting new information researcher will be used random sampling method which is
simple and effective for scholar. In this context, 20 consumers will be considered who will be
helpful enough to collect the information and to come up with appropriate method.
Expected Outcome
As per the outcome that will gathered from the research conducted, it can be stated that
business will get to understand the importance of customers who are loyal towards the
organization enable to raise the profitability and sales. Further, there are different set of scheme
that are adopted by the organization in order to attract more and more customers. As per the case
considered that is Marriott hotel will be able to get benefited as they will get the areas in which
improvements can be made with the help of which strong customers base can be developed. If
the organization is able to develop and maintain a strong customer base for longer time period
then, it will be able to attain sustainable development. This will further ensure that organization
will be attaining heights of success at all times.In addition to this, all the other research will also
get benefits with the type of strategies that are being used by companies to satisfy their
customers and to make them loyal to wards the services and products that are delivered by the
organization.
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Gantt Chart
Activit
y
1th
Week
2nd
Wee
k
3rd
Week
4th
Wee
k
5th Week 6th
Week
7th Week 8th
Week
9th
Wee
k
10th
Week
Find
researc
h
Topic
Litera
ture
Review
Drafti
ng of
metho
dology
Finish
Propos
al
Design
questio
n and
pilot
researc
h
Carry
out &
Record
Resear
ch
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Data
Analys
is and
Makin
g
Graph
s
Discus
sion
and
Conclu
sion
Final
Report
Editin
g &
Compl
etion
CONCLUSION
This research will enable to determine the different factors that should be considered by
the organization with the help of which strong customers base can be developed. As per the
analysis made research will help the firm to take up steps that will ensure high profitability and
sales.
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REFERENCES
BOOKS AND JOURNALS
Berezan, O., Raab, C., Tanford, S. and Kim, Y. S., 2015. Evaluating loyalty constructs among
hotel reward program members using eWOM. Journal of Hospitality & Tourism
Research. 39(2). pp.198-224.
Dorotic, M., and et.al., 2014. Reward redemption effects in a loyalty program when customers
choose how much and when to redeem. International Journal of Research in Marketing.
31(4), pp.339-355.
Hwang, J. and Kandampully, J., 2015. Embracing CSR in pro-social relationship marketing
program: understanding driving forces of positive consumer responses. Journal of Services
Marketing. 29(5). pp.344-353.
Khan, M. T., 2014. Customer loyalty programs-concept, types, goals and benefits (A conceptual
and review paper). International Journal of Information, Business and Management. 6(1).
p.74.
Meyer-Waarden, L., Benavent, C. and Castéran, H., 2013. The effects of purchase orientations
on perceived loyalty programmes' benefits and loyalty. International Journal of Retail &
Distribution Management. 41(3). pp.201-225.
Minnema, A., Bijmolt, T. H. and Non, M. C., 2017. The impact of instant reward programs and
bonus premiums on consumer purchase behavior. International Journal of Research in
Marketing. 34(1). pp.194-211.
Ramaseshan, B. and Guilfoyle, A., 2015. Factors Influencing Loyalty to Rewards Schemes in
Small Businesses. In Marketing in Transition: Scarcity, Globalism, & Sustainability (pp.
460-463). Springer International Publishing.
So, J. T., Danaher, T. and Gupta, S., 2015. What do customers get and give in return for loyalty
program membership?. Australasian Marketing Journal (AMJ). 23(3). pp.196-206.
Stathopoulou, A. and Balabanis, G., 2016. The effects of loyalty programs on customer
satisfaction, trust, and loyalty toward high-and low-end fashion retailers. Journal of
Business Research. 69(12). pp.5801-5808.
Steinhoff, L. and Palmatier, R. W., 2016. Understanding loyalty program effectiveness:
managing target and bystander effects. Journal of the Academy of Marketing
Science. 44(1). pp.88-107.
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Thompson, F. M. and Chmura, T., 2015. Loyalty programs in emerging and developed markets:
the impact of cultural values on loyalty program choice. Journal of International
Marketing. 23(3). pp.87-103.
Wang, Y., and et.al., 2016. Enduring effects of goal achievement and failure within customer
loyalty programs: A large-scale field experiment. Marketing Science. 35(4). pp.565-575.
Wieseke, J., Alavi, S. and Habel, J., 2014. Willing to pay more, eager to pay less: the role of
customer loyalty in price negotiations. Journal of Marketing. 78(6). pp.17-37.
Xiong, L., King, C. and Hu, C., 2014. Where is the love? Investigating multiple membership and
hotel customer loyalty. International Journal of Contemporary Hospitality Management.
26(4), pp.572-592.
Yi, Y., Jeon, H. and Choi, B., 2013. Segregation vs aggregation in the loyalty program: the role
of perceived uncertainty. European Journal of Marketing. 47(8). pp.1238-1255.
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